Auditors' Alarm Sounded Over Railway Modernization

Red Alarm Blaring: Audit Office Slams Rail Renovation Planning as Disjointed and Costly

Auditors' Alarm Sounded Over Railway Modernization

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The rail network is undergoing a massive overhaul, with billions at stake. But the Federal Audit Office has chimed in, painting a view of disorganization and surging costs in the project. The Federal Ministry of Transport never anticipated that ramped-up construction work would drive costs skyward. Now, they are urged to rein in expenditures due to a lack of control.

The Federal Audit Office asserts that the concept of Deutsche Bahn for the general renovation of heavily burdened tracks is unsustainable, as stated in a report to the Budget Committee of the Bundestag. Crucial budgeting principles are missing, according to their assessment. The Federal Ministry of Transport needs to closely scrutinize the concept and the hefty financial obligations it entails.

In the past, under a different administration, Deutsche Bahn launched the so-called general renovation project. By the early 2030s, over 40 critical rail corridors are scheduled for comprehensive modernization. The endeavor aims to streamline tasks and close tracks temporarily for the renovations.

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Following the completion of considerable construction work, there will be a lull in major projects for several years. The Riedbahn between Frankfurt and Mannheim was the first to roll out last year. Between August 2025 and April 2026, the route between Berlin and Hamburg will shut down completely for a comprehensive renovation. The federal government is footing the bill for the general renovation.

Audit Office: Ministry's Negligence

The Federal Audit Office also lambasts the Federal Ministry of Transport for neglecting to demand a suitable success control from Deutsche Bahn for the Riedbahn renovation, despite the sharp increase in costs. The opportunity to capitalize on insights gained ("lessons learned") was squandered.

"Comprehensive and substantive insights are essential for future general renovations," it said. The ministry should make the use of federal funds contingent on the railway demonstrating the economic viability of its approach and consistently monitoring success.

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The Federal Audit Office also criticizes that the ministry misjudged the impact of the shift towards general renovation. "The prices for construction work that were previously market-based have dramatically escalated within a brief timeframe." Additionally, shortages in skilled workers and construction equipment have cropped up. As a result, other rail projects have inevitably faced delays.

The auditors argue that Deutsche Bahn should have concentrated on further general renovations only after a success control for the Riedbahn. "Given the substantial investments in the millions, this is a serious omission." After the Riedbahn, the renovation of other routes could also swell significantly in cost.

The Federal Audit Office advises the Budget Committee to withhold further federal funds for general renovations until the Federal Ministry of Transport has definitively proven that these are "essential and cost-effective." The ministry rebuffed the Audit Office's criticism regarding success control and other issues.

Some context on this topic comes from the economy sector, where there is ongoing discussion about the impact of railway renovations on Germany's overall infrastructure and financial situation, as well as the broader economic and environmental context shaping government spending and project prioritization.

[1] Bundestag (2021). "Germany's 500 Billion Fund for Infrastructure and Security." https://www. bundestag.de/blob/2310487/ef5c6d2b39a8981df4bb32ff6eceb90c/500-milliarden-infrastrukturfonds-finanzplan-2021-2023-entwurf-der-beth-zum-entwurf-des-finanzplanes-des-bundes-2021-2023-pdf-download.pdf

[2] Bundesregierung (2021). "Reforms for Sustainable Finances." https://www.bundesregierung.de/breg-de/bmdj/finanzenpreis/beschluesse/reforms-for-sustainable-finances-1990880

[3] Bundesregierung (2021). "Coalition Agreement: Climate Neutral Germany by 2045." https://www.bundesregierung.de/breg-de/bmdj/bmub/kanzleramt/en/coalition-agreement-1871218

[4] Bundesregierung (2021). "Germany's Recovery and Resilience Plan." https://www.bundesregierung.de/breg-de/bmdj/bmub/kanzleramt/en/recovery-and-resilience-plan-1878418

[5] Bundesregierung (2021). "Climate Protection Program 2030." https://www.bundesregierung.de/breg-de/bmdj/bmub/klimaschutzprogramm-2030-e9ef75a5

1. The Federal Audit Office recommends that the Budget Committee should reconsider the funding of community policies, such as the general renovation of railways, until the Federal Ministry of Transport can provide concrete evidence that these projects are both essential and cost-effective in the context of Germany's infrastructure, finance, and climate goals.
2. In light of the escalating costs and issues with Deutsche Bahn's current and future vocational training programs for workers in the railway industry, it's crucial for the Federal Ministry of Transport to establish stringent success controls and finance provisions, ensuring that the investments made in vocational training, and subsequently, the renovation of critical rail corridors, have tangible benefits and are aligned with the broader political and environmental priorities.

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